Q 7SE-3 - Horngren'S Financial And Managerial Accounting

Question

On November 1, Carlisle Equipment had a beginning balance in the Office Supplies account of \(600. During the month, Carlisle purchased \)2,300 of office supplies. At November 30, Carlisle Equipment had $500 of office supplies on hand. Requirements 1. Open the Office Supplies T-account, and enter the beginning balance and purchase of office supplies. 2. Record the adjusting entry required at November 30. 3. Post the adjusting entry to the two accounts involved, and show their balances at November 30.

Step-by-Step Solution

Answer

T-accounts are as follows:

Office Supplies
Nov.1	600	2,400	Nov.30
Nov.	2,300
Bal.	500

 

Supplies Expense
Nov.30	2,400
Bal.	2,400

Step-by-Step-Solution Step 1: Explanation on Office Supplies

Office supplies are the current assets of the business, and it has a normal debit balance.

Step 2: Explanation on T-account

In the T-account of Office Supplies, beginning balance of office supplies of $600 will be posted left side in the account, and also the purchase of $2,300 will be posted in left side. Office supplies used of $2,400 will be posted in right side, and the ending balance equals $500. 

In the T-account of supplies expense, the supplies used of $2,400 will be posted at left side. And the balance equals $2,400.